Minnesota Estate Administration Lawyers
It is difficult to lose a spouse or parent. The death of a loved one is made even more challenging as, in our experience, death and money change people.
Many times after your loved one's death, it is necessary to set up a probate through court to disburse the decedent's assets. A probate is necessary in Minnesota to pass a decedent's assets if the person's probate assets are collectively worth over $75,000 or if the probate estate includes any real estate.
A common misconception is that the existence of a Last Will & Testament avoids the necessity of probate. This is simply not true, as if the decedent's probate assets exceed $75,000 or include real property, a probate will be needed to legally pass the decedent's assets.
To that end, it is important to understand the difference between probate and non-probate assets as the difference will significantly impact how the assets will be distributed.
A probate proceeding is a complex and lengthy court process. An attorney experienced with probate can help the estate administration proceed efficiently. Our law firm has helped many clients to simplify the complicated probate process.
What is Probate?
Probate is a court process that occurs after someone dies. The probate process is subject to a series of laws and rules that direct how the probate is to be managed from beginning to end.
A common misconception is that when an individual has a Last Will & Testament, probate is not required. However, this is not the case. In fact, a Last Will & Testament only provides instructions on how a person’s assets that are subject to probate are distributed and who is appointed to administer their probate estate.
Probate requires paperwork to be submitted to court and sometimes appearances in court by attorneys and the individual who is requesting the court appointment them to administer the probate. The individual appointed by the court to administer the probate is commonly referred to as the personal representative or executor.
The cost to administer the probate, including the filing fees, lawyers’ fees and administration fees are paid from the property that is probated.
The purpose of probate is to:
confirm that the individual has died;
determine whether or not the deceased individual had a Last Will or Testament and verify its authenticity;
identify the deceased individual’s heirs and beneficiaries;
identify, inventory and value the deceased person’s property;
pay the deceased person’s unpaid bills and estate taxes; and
distribute any remaining property in accordance with the will or as Minnesota directs.
Starting the Probate Process
Usually, the probate proceeding is initiated in the county of the decedent’s legal residence at the time of their death.
If there is a Will...
The original copy of decedent’s will is submitted to court along with a petition or application to probate the will and appoint a personal representative. The will typically nominates a personal representative.
If there is not a Will...
If there is no will, a person with the priority of appointment must submit a petition or application requesting to be appointed as personal representative of the decedent. Most often, this is the personal representative is the surviving spouse or an adult child. If there is a dispute over who should serve as a personal representative, the court may appoint a neutral personal representative who can be counted on to be fair. This person is paid an hourly fee from estate funds.
A personal representative’s authority only extends to the “probate estate” – defined as property subject to the jurisdiction of the probate court. Assets disposed of outside the probate process are part of the “non-probate estate,” and the personal representative has no control of these. An example would be a life insurance policy that has a beneficiary designation. If a decedent has probate property in another state, then that property must be subjected to ancillary probate in the other state.
The personal representative will file a Petition or Application for Probate and Appointment of Personal Representative. The petition or application will be filed at the county court administrator’s office along with a certified copy of the death certificate and the original will, if there is one.
We will then publish and cause the notice of probate to be served in accordance with Minnesota law. Once submitted to probate, a will is a public record, and so are the subsequent filings with the court. These papers are open to inspection by anyone.
Depending upon whether we have initiated a formal or informal probate proceeding, a hearing date may be set for the personal representative to appear be formally appointed by a judge At the hearing the court will review the will to determine its genuineness and validity as well as appoint a personal representative. The court issues an order appointing the personal representative.
Once appointed, the personal representative has full authority to administer the decedent’s probate property and accounts. The court will issue letters of administration to the personal representative to reflect the personal representative’s authority.
The Basic Steps of Probate
After the documents appointing the personal representative and commencing probate have been received from the court, there are four basic steps of probate. The difficulty of these steps vary greatly based upon the nature of the decedent’s property and the reasonableness of the people involved, but it usually takes between six to twelve months to complete.
The first step is collection, inventory, and appraisal of all assets that are subject to probate are taken. The values taken at the appraisal are based on the value at the date of death. One of the first duties that we will assist the personal representative with is to take an inventory of estate assets. These assets include real estate, personal property, investment, and bank accounts, vehicles as well as funds that are owed to the decedent or the estate, e.g. loans, final paycheck, life insurance, or retirement account made payable to the estate. We will assist you in preparing this inventory so that it can be filed with the court within thirty days of being appointed as a personal representative.
An estate checking account is created for the decedent’s household final bills and estate expenses (e.g., attorney, appraiser). It is necessary to have the account set up so that check images are returned to the personal representative. This checking account is also useful for combining all the decedent’s financial accounts into a single pot.
Paying the bills – taxes, estate expenses, and creditors of the decedent is the next step. The personal representative is not personally responsible for paying these expenses out-of-pocket if estate funds are not available provided the personal representative administers the estate in accordance with Minnesota law. The order of payment of claims against the estate is as follows: a) secured creditors; b) costs/expenses of administration; c) funeral expenses; d) debts and taxes; e) all other claims and creditors.
We will assist the personal representative in reviewing the decedent’s final bills, debts, and claims, to determine which bills are valid and then pay those and reject the rest.
We will assist you with the legal requirements pertaining to the allowance and disallowance of the claims. A creditor has four months from the time the notice of probate is published to submit a claim against the estate.
Formal transfer of estate property according to the will or by Minnesota laws on intestate succession (if there is no will).
When all rightful claims, debts and expenses have been paid, the remainder of the property is distributed by the executor as the will directs. At this point, if there is no will, the personal representative distributes property according to Minnesota interstate law. We will assist the personal representative to determine whether the personal representative should distribute the estate in cash or in kind (i.e., give away the property itself to the beneficiaries instead of liquidating the assets for cash).
Most wills allow the personal representative to sell or transfer real estate after a legally specified waiting period. The personal representative usually may sell or transfer the testator’s (decedent’s) personal property any time but may not begin final distribution of property or sale proceeds until after all expenses have been paid or pursuant to an order of the court.
When the waiting periods have expired and all legitimate bills, debts, and taxes have been paid, what remains of the estate is available for distribution to heirs or beneficiaries. Only then will we assist the personal representative to make disbursements of cash, send copies of documents such as deeds and investment statements showing new ownership and transfer physical property to the respective beneficiaries.
The final step is to prepare and file the final probate documents closing the estate, including an accounting of all income, payments, and distributions made collected or made by the personal representative. Depending upon whether an informal or formal probate had been commenced, once the judge approves the final settlement, the personal representative usually has no further duties and the estate is considered closed if it is a formal estate or administratively.